M&S is 'committed' to Ireland, despite gloom
Published 25/05/2011 | 05:00
Marks & Spencer (M&S) has said it remains "committed" to Ireland despite economic problems here. The retailer made the comment as it reported a 5.6pc increase in underlying profit to £825m (€946m) for its last financial year. Pre-tax profit surged nearly 13pc to £714m (€819m), while revenue in the 52 weeks to April 2 rose 4.2pc to £9.7bn (€11.1bn).
Despite the growth in sales and profits matching the top end of analyst expectations, shares in the company slid in London as investors worried that a grim outlook by the retailer could mean dampened figures this financial year.
M&S -- whose chief executive Marc Bolland has been in the job for just one year -- warned that while it has gotten off to a good start this financial year, trading conditions for the remainder of the period will be challenging due to pressure on disposable incomes and high commodity prices.
M&S has 19 stores in Ireland, the most recent of which, in Cork, opened late last year.
In the UK M&S sales were up 4pc to £8.7bn (€10bn) in the last financial year, while sales from its international division that includes Ireland and operations in countries such as Greece, China, Poland and Estonia, were 6.1pc higher at £1bn (€1.14bn) -- reaching a target the group hadn't expected to hit until 2013 or 2014.
The group also recorded a one-off pension credit of £10.7m (€12.2m) due to changes in its pension scheme for 3,000 employees in Ireland. The change will cap future annual increases in pensionable pay to 4pc.
"The results mark a confident start by the new chief executive," said analyst Keith Bowman at Hargreaves Lansdown. Shares in M&S closed down 2.9pc in London at £3.86.